Second gas plant could ease pressure on electricity tariffs – Ghana Gas

Ghana’s planned second gas processing plant could help ease pressure on electricity tariffs by increasing the availability of natural gas for power generation, the Ghana Gas Company has said. General Manager for Engineering and Maintenance at Ghana Gas, Ing. Maxwell Kwame Kelly, said although electricity costs could continue to rise as the country’s energy needs expand, greater access to natural gas could reduce the pace of future tariff increases.

“Obviously, as you grow as a country, things will go up. But the rates at which things will go up will be reduced, yes,” he said. Kelly said the benefits of the proposed second gas processing plant, known as GPP2, should be assessed against the cost of relying on alternative fuels to generate electricity.

“Certainly, if you consider the alternative,” he said. “If you consider the alternative to not having the gas processing plant, you realise that the benefit is colossal.” Potential to cut fuel costs Technical Advisor to the Minister of Energy and Green Transition on Petroleum, Ing. Dr Sulemana Yussif, said the additional processing capacity could allow Ghana to rely more heavily on natural gas instead of liquid fuels for thermal power generation.

He estimated that the switch could save the country close to US$500 million annually. “If we switch from liquid, let’s say LCO, light crude oil, to generate power and use gas, we are saving closer to half a billion on an annual basis,” he said. “That is huge.” The estimate highlights the potential impact of GPP2 on the cost of thermal power generation, particularly as Ghana seeks to reduce its reliance on more expensive liquid fuels.

Kelly said the benefits of GPP2 would not be limited to electricity generation. He pointed to the potential increase in liquefied petroleum gas (LPG) production, noting that Ghana Gas currently supplies about half of the country’s LPG demand. According to him, additional processing capacity would increase domestic LPG production and help reduce Ghana’s dependence on imports.

“So in that sense, yes, it will maintain or reduce electricity tariff,” he said. Benefits for oil production Gas Business Manager at the Ghana National Petroleum Corporation (GNPC), Emmanuel Tamaku, said GPP2 could also help address constraints affecting Ghana’s upstream petroleum industry. He explained that some oil fields are prod…